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  • 1.  Holding Account Policies

    Posted 01-11-2023 09:03 AM
    Good morning.

    I am looking to see if anyone has a policy or procedure, they can share on the use of their holding account. Meaning, a check comes in and is put into the bank account but there is no backup for the transaction. Sometimes, the funds are placed in holding until it can be researched and applied to the correct donor, allocation, etc. I am looking for what others do at their organizations in terms of rules (when it goes in holding, how long, etc.), best practices, etc. I would appreciate any insight you can offer.

    Thanks.

    Trish

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    Trish Idarola
    University of New Mexico Foundation
    trish.idarola@unmfund.org
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  • 2.  RE: Holding Account Policies

    Posted 01-20-2023 03:45 PM
    Good afternoon, Trish - 

    In the near future we are going to be working on defining holding account parameters and procedures here at CUA. Sadly I can say I've been at organizations where I've come in to find that transactions had been sitting in a suspense account for - in two cases - well over a decade. One wonders how this hadn't been an audit flag, of course. IMHO, there are few circumstances where a gift shouldn't be able to clear out of a holding account within 2 weeks. Occasionally there might be a delay if a new fund needs to be created which might take a few extra days to establish with Finance. 

    The most frequent scenario I've encountered across multiple organizations is when a gift arrives either prior to, or during the process of, negotiating a gift agreement. There isn't a lot that can be done other than to keep reminding fundraisers (and escalating as might be needed) that it does become an audit risk to not have donor money into a fund where it can be spent as the donor intended. Certainly part of the fiscal year reconciliation process should be a final review and effort to get everythig out of suspense as possible. 

    Your Finance/Comptroller colleagues should be helping develop any procedures and parameters which would make the most sense for your institution, as well. 

    Good luck!   -Amy

    Amy J. Phillips
    Director of Advancement Services, Gift Acceptance
    Division of University Advancement
    The Catholic University of America
    620 Michigan Avenue, B016 O'Connell Hall
    Washington, DC 20064
    Phone: 202-319-6919




    Original Message


  • 3.  RE: Holding Account Policies

    Posted 01-20-2023 04:00 PM
    If we receive a gift and there is no donor name attached to it, we will record it to our Anonymous Donor record. This is our go-to, so that if down the road a donor reaches out and confirms it was their gift, we adjust the gift to that donor. 

    If we have a donor name, but the donor doesn't indicate a restriction with the gift, our default is to record it as an unrestricted gift to our annual fund.  If it's a large dollar amount and there's no gift planner assigned to the donor, a gift planner may be assigned to reach out to the donor and learn more about their philanthropic goals.

    If we know the donor, and they tell us they want to make this gift now and decide later how to restrict it, we let them know that we'll place the gift in our Holding Account, but that we have to have a decision before the end of the fiscal year, as the holding account has to be cleared before we close the books.  Both we and the Controller have our eye on that account to make sure we're actively working to clear everything out before FYE.






    Original Message


  • 4.  RE: Holding Account Policies

    Posted 01-23-2023 10:03 AM
      |   view attached
    Trish,

    Lehigh recently finished up a policy on, "Unidentified Donors and Unknown Gift Purposes," which, for us, are the two biggest reasons something hangs around in our pending account. Of course, we have other internal reasons for gifts sitting in pending (gift comes in during GA negotiation, waiting on a dept. and/or Finance to set something up, etc...), but the two external reasons are the ones that usually cause gifts to sit around for the longest. I've attached the final draft of our policy.

    Hope this helps.

    Sean

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    Sean Shappell
    Asst. Vice President, Information Services
    Lehigh University
    ses211@lehigh.edu
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    Original Message


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